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Wednesday, October 8, 2014

Taking a Look at Past Interest Rates


There are many great Orange & LA County area homes for sale. Click here to perform a full home search, or if you're thinking of selling your home, click here for a FREE Home Price Evaluation so you know what buyers will pay for your home in today's market. You may also call me at for a FREE home buying or selling consultation to answer any of your real estate questions. 

There's been quite a bit of speculation about whether interest rates are going to rise soon. While everyone agrees rates will rise sometime next year, no one really knows when. One thing we do know is that rates are currently at historic lows. Based on a $200,000 home and a 30-year fixed-rate mortgage, we put together this chart to illustrate how lucky we are right now:
  • 1970s: The average rate was 8.86%, the average payment was $1,589
  • 1980s: The average rate was 12.7%, the average payment was $2,166
  • 1990s: The average rate was 8.12%, the average payment was $1,484
  • 2000s: The average rate was 6.29%, the average payment was $1,237 
  • Today: The average rate is 4.10%, the average payment is $966

Even with rates expected to rise, we are in great shape historically. If there is a one point increase, rates will still be well below the average of the last four decades. The market is in a strange place right now - prices are softening, inventory is starting to rise, and interest rates are incredibly low. Really, it's a fantastic time to look for a home.

One thing to think about, however, is the potential for rates to rise more than a single point. If the past decades tell us anything, it's that rates are never this low and if they are, they don't stay low. Years from now, people won't be talking about the price they got for their home, but the interest rates they were able to lock in!

Whether you're refinancing, downsizing, or upgrading, now is the time to lock in an incredibly low interest rate and increase your future spending power. Low rates make or break what you're able to afford payment-wise, so give us a call and we'll set you up with some great lenders. We look forward to hearing from you soon!

Wednesday, September 24, 2014

Inventory and Home Sales: What's the Relationship?


There are many great Orange & LA County area homes for sale. Click here to perform a full home search, or if you're thinking of selling your home, click here for a FREE Home Price Evaluation so you know what buyers will pay for your home in today's market. You may also call me at for a FREE home buying or selling consultation to answer any of your real estate questions.

Our market has been changing a lot lately. One area where we have seen a lot of change is in inventory. In the video, we created a bar graph that illustrates the point. This graph shows both our available inventory and our sold homes over the last 9 years. We collected the data from the past 9 years specifically because 9 years ago is when the market shifted. The public didn't see this shift until 2006 and by that time it was too late.

An interesting note regarding the graphs:

Back in August 2005, we had just under 1200 homes for sale and 600 homes sold. Fast forward to August 2014, where we have 1100 homes for sale and only 400 homes sold. It appears that history may be repeating itself. Back in 2005, this caused inventory to skyrocket and prices plummeted for the next 5 years. Such trends were not just exclusive to Orange County, as both San Bernadino and Los Angeles County experienced the same increase/decrease activity between inventory and homes sold.


So what does this mean for home buyers and sellers? Well, it's basic economics. The lower the supply, or in this case, properties, the higher the demand for it. As a result, people pay a higher price. The higher the supply is, the less the demand to buy it. More importantly, this results in a much lower price. This increase in inventory and subsequent slow in sales is one of the many factors that are resulting in market change.

Real estate is hyper-local. Each area is a little different. If you want to see what is actually happening in your specific town or neighborhood, send us an email with the name of the area to fdelrio@live.com


Our intention is to provide you with the most accurate information possible so you can make the best decision for you and your family. If you have thoughts about refinancing and are therefore waiting for more equity, now actually may be a good time to start before prices slide back further. If you are thinking of making a move in the next 3-4 months, you may want to take a closer look at your situation to see if it makes sense to start now before prices come down even further.

You probably know someone who has owned a home from 2006-2012 and wished they would have sold in 2005 before the prices went down and they lost all their equity. We don't want this to happen to you or anybody you know this time around, so do us a favor. Forward this video to someone you think it will help. Of course, if you need to speak with me about your situation, give us a call and we can discuss a good game plan for you.

Friday, August 29, 2014

Orange and Los Angeles County Market Changes



There are many great Orange & LA County area homes for sale. Click here to perform a full home search, or if you're thinking of selling your home, click here for a FREE Home Price Evaluation so you know what buyers will pay for your home in today's market. You may also call me at (714) 335-0844 for a FREE home buying or selling consultation to answer any of your real estate questions.
 
Since January, we have been helping people buy, list, and sell every single week, so we have an exact pulse of what's going on in our Orange County market. We are going to be sending you videos every few weeks, so you can be aware of current trends and anticipate future changes in real estate.

Like most agents, we can get you a simple CMA or free market evaluation if you're interested. Unlike most agents, however, we are always available to talk to you about market conditions in our area. If you are interested in what's going on in real estate, contact us immediately - changes are coming that are going to have a huge impact on home values. We'll keep you updated as much as we can here on this video blog, but being proactive is the best way to successfully navigate the market.

If you have any questions about buying or selling, you can reach us in whatever way is most convenient for you. Call us at (714) 335-0844, email us at FDelRio@live.com, or text us at (626) 780-2705. Thanks, and have a great week!

Tuesday, July 29, 2014

Things to keep in mind before you decide to sell


There are many great Orange & LA County area homes for sale. Click here to perform a full home search, or if you're thinking of selling your home, click here for a FREE Home Price Evaluation so you know what buyers will pay for your home in today's market. You may also call me at (714) 335-0844 for a FREE home buying or selling consultation to answer any of your real estate questions.


Welcome back to our video blog, your place for online real estate information, ideas, and how to get the most out of the market. Right now, the Orange County market is still a great market for home sellers, which is good news if you have been on the fence about selling. Limited inventory continues to drive home prices up. During the summer, the days are longer, giving more hours for buyers to look at your property.

Of course, the decision to sell your home isn't solely based on market conditions. You have to look at your personal situation to know when the right time to sell is. To help you do that, we have come up with a list of 4 things to keep in mind before planting that "For Sale" sign in your yard.

1. Be debt-free
  If you didn't have all of your financial ducks in a row the first time around the home buying block, you've probably learned a lot of good lessons the hard way. Put those lessons to good use and be a money-smart home buyer this time around. Check out your finances to make sure you have your savings in order before you purchase

2. Equity is on your side

 Just a few years ago, home values plummeted. A lot of us remember those times. It sent many mortgages underwater, but thankfully, the tide has turned. If you aren't sure what your home's equity is right now, we can get you a free Competitive Market Analysis to determine the approximate value of your home. If your home has recovered enough value to provide you with 20% or more equity on your next purchase, putting that amount down on a new home will keep private mortgage insurance companies at bay.

3. Does your home fit your lifestyle?

 Is your home currently meeting your everyday needs? Perhaps you could really use an extra room or two for your growing family. On the other hand, empty-nesters can really benefit from selling right now while rates are low in Orange County. You can sell your large home, move into a smaller one, then put the rest towards your retirement.

4. Can you afford the move?
 Don't get so excited about your next home that you forget the costs of leaving your current one. Hiring professional movers and being prepared for costs to improve your home for prime time showing should all play a factor. Painting your home is one of the best and cheapest improvements you can make to increase your home's worth.

Ultimately, there is no single formula for determining when to sell your home. Partner with a real estate professional you can trust to provide you with honest advice for you, your family, and your budget. If you have any questions at all, please feel free to give us a call. We would love to help you out with whatever you need!
 

Tuesday, July 8, 2014

Orange & LA County Real Estate Market Update for June 2014


There are many great Orange & LA County area homes for sale. Click here to perform a full home search, or if you're thinking of selling your home, click here for a FREE Home Price Evaluation so you know what buyers will pay for your home in today's market. You may also call me at (714) 335-0844 for a FREE home buying or selling consultation to answer any of your real estate questions.

 It's been a little while since we last spoke with you, and some key things have shifted in the Orange & LA County real estate market. Hopefully you find this information useful if you're buying or selling.

  • Normal / Stable Market: We are entering a stable market due to an increasing inventory of homes. We currently have a 3-month supply of homes, compared to last June when we had a 30 day supply. 
    • This is an improvement over last year when people were fighting each other over available homes. This year, if you have an attractively priced home in a good location, you'll be able to sell it for a good price and possibly receive multiple offers. I would also expect a slight amount of appreciation stemming from these changes.
  • Less Demand: Another thing to note is that we do not have the backlog of buyers that we once had, and so even if your home is well-priced, in good condition and in a good location, you may sit on the market for a few weeks. This has nothing to do with your property being sub-par, we simply don't have the number of buyers we used to. 
  • Low Interest Rates: Mortgage interest rates continue to stay very low. Rates are currently sitting around 4.25%, but they are expected to rise by a whole percentage point by the first quarter of 2015. If you're thinking of buying, now would be a good time to do so because homes are very affordable right now. If you wait, you will only be paying more and more in your monthly mortgage payments, and that could cost you thousands of dollars over the course of a loan.  
  • Listing Price or Higher: Unfortunately for buyers, you will likely have to pay the listing price for a home, or maybe even a little extra. You may be able to negotiate, but for the most part my clients in Los Angeles and Orange County are paying the full listing price.  
  • Don't Mind the Media: There have been various reports that have been hounding the real estate industry, and you should disregard them. They are using old, dated information from almost 6 months ago. The same is true for real estate websites - you should be wary to trust their information including home listings and home pricing. You should always consult your local real estate agent if you want the most updated information about real estate in your area.

At the end of the day we have a very stable market with slight appreciation (depending on where you are). Below this text I have also included two figures that illustrate precise differences between the market of June 2013 vs. June 2014 (just click on them to enlarge).

If you have any questions about this information or about Orange & LA County real estate in general, please do not hesitate to contact me. I am always willing to sit down with you to discuss all of your individual needs.












Tuesday, June 17, 2014

The Benefits of Trading Up



There are many great Orange County area homes for sale. Click here to perform a full home search, or if you're thinking of selling your home, click here for a FREE Home Price Evaluation so you know what buyers will pay for your home in today's market. You may also call me at (714) 335-0844 for a FREE home buying or selling consultation to answer any of your real estate questions.

The Benefits of Trading Up
I want to talk to you about a subject that  I am very passionate about. I want to discuss trade up purchases. We specialize in these types of property sales at Frank Del Rio and Associates, and there are many benefits of trading up that you need to know about.

"Trading Up" refers to selling your existing property in order to purchase a more expensive property. This has become a common trend with our clients for a couple of different reasons:

  • Our clients want to lock in the mortgage rates on a more expensive home. Mortgage rates are at an all-time low and locking in these rates now is a wise investment. 
  • Trading up also locks in any future appreciation that a home may have. The more expensive a home is, the more it will appreciate in value over time.
 There are a couple different ways that you can trade up: 
  •  You could sell your existing home first and then purchase a new one.
  •  You could purchase the new home first and sell your old home at a later date
Whichever method you prefer, I am more than willing to aid you with expert guidance and advice throughout the entire process, ensuring that you make a sound decision with the best results possible.

If you have any questions about how to price your property, then please don't hesitate to contact me. You can reach me via phone or email and I would be more than happy to share some advice with you.

Tuesday, May 20, 2014

Price Reductions Trending? You Need to be Prepared



There are many great Orange County area homes for sale. Click here to perform a full home search, or if you're thinking of selling your home, click here for a FREE Home Price Evaluation so you know what buyers will pay for your home in today's market. You may also call me at (714) 335-0844 for a FREE home buying or selling consultation to answer any of your real estate questions.

Selling your home without reducing the price?
Today I would like to speak with you about a pricing trend that I am seeing right now. This trend is price reductions. We have not experienced price reductions in almost a year and a half in our local real estate market. The market has been so hot that sellers believe that buyers will purchase for any price, but that is not the case anymore.

What we know is that inventory is up in Orange County, Eastern San Gabriel Valley, and the West Inland Empire. Inventory is actually up by 25% from January and sales have slowed down tremendously. If a Realtor or anyone else tells you that prices are still rising and the market is booming, well, nothing could be further from the truth.

Sellers are making price reductions for three different reasons:
  1. The seller isn't listening to the agent's advice about competitively pricing the property.
  2. The seller chose the price based on inaccurate information, or they just got a little greedy. 
  3. The seller hired an inexperienced agent to sell the home, and they overpriced it. This is happening more and more often, so it is important to hire an experienced agent. 

If you price your home too high the market will immediately shun you. Buyers will not think twice about your home and you will spend weeks on the market until you are forced to sell your home at a highly reduced price. You definitely don't want to put yourself in a situation like this.

To stay competitive and get the most money while pricing your property, follow these guidelines:
  • Listen to a great Realtor who has a proven track record of selling homes. Look at their individual record, not their company's record.
  • Ask the agent what their list-to-sale price ratio is. A true professional will know these numbers and can provide you with proof of these numbers. 
    • I'm currently getting my clients 99.8% of the asking price, and the average Realtor will only get you 92.2% of the asking price.

Make sure to do your research when pricing your home. You should know the home prices in your local area and how they compare to your own property. If you price your property just a hair below the real value, you will be creating momentum in the market and buyers will see a great value in your property. This will subsequently rise the price of your home through multiple offers and a bidding war may eventually ensue, causing you to get more money than you ever could have hoped for.

I also want you to know that the market will never let your home sell for too little. The market will naturally raise the price and buyers will offer more and more for your home. However, the market will allow an overpriced home to sit for months. This is why it is so crucial to price your home properly.

With this being said, if you have any questions about how to price your property, then please don't hesitate to contact me. You can reach me via phone or email and I would be more than happy to share some advice with you.